Sharon McDougall - 30th March 2022 - 2 minutes to read
The scale of borrowing via credit card debt increased sharply in February as a growing number of British households struggled to cover their essential outgoings.
Inflationary pressures, particularly in relation to energy bills, are making it increasingly tough for individuals and families to make ends meet without adding to their debts.
According to the Bank of England’s latest data, there was a total of £1.5 billion newly borrowed via credit cards in February, which represents a one-month increase not seen since records began in 1993.
The concern among debt help campaigners is that huge numbers of consumers are now being left with little choice but to use credit card debt to cover essential outgoings, including their energy bills, their council tax bills and their rent or mortgage payments.
Ultimately, if more and more people use debt to pay for their most important outgoings, it’s inevitable that there will be a significant increase in the prevalence of problem debt and a major proliferation of unsustainable financial situations.
For its part, the debt help charity StepChange is already expecting to see an influx of people getting in touch with its experts because their incomes are not enough to cover even their most essential outgoings.
“More and more, what we are seeing is that people experiencing problem debt have problems meeting not just their credit repayments, but also their priority bills,” explained Peter Tutton, head of policy, research and public affairs at StepChange.
The charity has said that unless policymakers at government level are able to step in and help people who are struggling financially then issues with problem debt across the country will continue to worsen.
“We urge anyone struggling to make ends meet to seek help from a reputable debt advice organisation at an early stage, rather than turning to potentially more harmful coping strategies such as high-cost credit,” said Mr Tutton from StepChange in a statement.
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